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Credit Card Loss Protection - Unnecessary Debt Insurance?If you're like most Americans today, you probably have and use more than two credit cards. For most people, this is an unnecessary thing, but we all like to know that the credit is there if we need it. But having numerous cards can be a problem for many people, as it can mix balances up, create a potential for missed payments or even create the possibility of theft which can be huge if the card's lost presence goes unnoticed. This is why carrying a single card can be a great thing. With one card, you always know where you are spending your money and how much. It also makes managing credit card debt a whole lot easier.Credit Card Theft - It Does Happen Each year, thousands of credit cards are stolen across North America, a trend that costs credit card companies millions of dollars. But, this cost is contained mainly by the pattern exhibited by most credit card thieves. The fact is, most credit card thieves will use the credit card as soon as possible, as time is critical. Once an incident of theft is reported to the credit card companies, the cards become effectively useless, so most thieves act quickly, sometimes charging thousands of dollars worth of goods within minutes. What About Credit Card Loss Protection?Because credit card theft is relatively common, a new dubious industry has been spawned. Companies in this industry offer credit card protection for you in the event that your card is lost or stolen, and a thief uses your card to charge unauthorized purchases. The scheme goes like this: for a fee, the company will typically offer you protection which will save you large amounts of money which would be charged in the event of a theft. The point here is to protect you from having to pay off thousands of dollars of credit card debt which you should not be responsible for. A great premise, but sadly this offer is a scam.Why Is Credit Card Protection A Scam? What many people do not recognize is that US federal law mandates that in cases of credit card theft or illegal credit card activity, the cardholder is only responsible for the first $50. So therefore, Federal law alone exempts you from even needing to consider a credit card protection scheme. The truth about these schemes is that they are simply there to collect cash from you or to gain personal information about you for use in illegal schemes. Typically, operations like this use telemarketers. Signs To Watch For
Certainly, losing your credit cards either through
simple loss or theft is not an experience any of us want. When it does
happen, ensure you report the card lost as soon as possible. The fact
is, the quicker you act, the less likely it is you will have to pay down
credit card debt you were not responsible for. Reporting the incident
immediately will mean your liability is greatly lessened, and you will
be issued a new card which will probably arrive at your door within a
week. |
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